The Family raises $17.4 million to support European startups
The Family has always been an ambitious startup accelerator. But it has always felt like the company never had enough money to grow as quickly as it wanted. The Family is raising a new $17.4 million funding round (€15 million).
“It’s the first time an investor understands The Family’s business model. It’s the first time an investor isn’t trying to turn us into a VC fund,” The Family co-founder Oussama Ammar told me.
According to him, The Family is basically going to do more of the same. Except that this funding round “makes [The Family] virtually immortal.” The Family had to double-check its bank account many, many times to make sure that there was enough money to pay all its employees. This funding round should let the company catch its breath.
The Family has fine-tuned its fellowship program over the years. Here’s how it works today. Every quarter, around 20 startups join The Family. They will attend onboarding sessions in Paris, Berlin and London.
In Paris, The Family’s team is focused on product and engineering. In London, The Family can help you raise money. And in Berlin, The Family’s team is all about operations and execution.
After the onboarding stuff, companies can still seek for advice and connections. There’s no demo day and end of batch. The Family plans to support startups when it comes to funding, product, hiring and more.
Being part of The Family is not free of course. Startups need to be willing to give away 5 percent of their equity in exchange of this support system. This isn’t for everyone and many entrepreneurs are already surrounded by a supportive ecosystem. So if you don’t think you’re getting enough value, you can ask for your shares back within a year.
With today’s funding round, The Family plans to invest in every funding round after a startup joins the fellowship. As a startup, if you can find a lead investor, The Family will automatically join the round with the same valuation and conditions.
But the fellowship is just one side of the story. “Our goal with the fellowship is that we never exit because we want to maximize the returns on investment,” Ammar said.
In order to support a staff of 60 people around 3 countries, The Family had to find a way to make money before those long-term exits. That’s why the company has launched other products.
For instance, Pathfinder helps big companies become digital companies, Lion educates startup employees and Kymono sells startup sweatshirts. The Family has spun off all those products into their own companies. They all have a dedicated CEO and team, but The Family retains at least 60 percent of the shares.
And The Family wants to create more side businesses like those. It seems like The Family is leveraging this model to finance all the fellowship activities.
Eventually, The Family’s dream is to be able to follow portfolio companies at every step of the way. It’s clear that you don’t need as much external support if you’re a Series C company. But The Family wants to become an infrastructure company that lets you build European tech giants.